International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
“What’s at Stake”: The Maggi Noodles Story
(A Case Study)
Dr. Jaskaran Singh Dhillon, Associate Professor, School of Commerce and Management, Sri Guru Granth Sahib World
University, Fatehgarh Sahib (Punjab)
Tejbir Kaur, Assistant Professor, School of Commerce and Management, Sri Guru Granth Sahib World University,
Fatehgarh Sahib (Punjab)
Dr. Rubeena Bajwa, Assistant Professor, School of Commerce and Management, Sri Guru Granth Sahib World
University, Fatehgarh Sahib (Punjab)
ABSTRACT
‘MAGGI is like our Mothers who are constantly
understanding our lifestyles as we grow, going deeper for
consumer insights, beyond the obvious and searching for
the ‘moment of truth’. MAGGI has constantly been as ‘The
Most Powerful Brand in India’. The Brand Maggi- has
presence in 130 countries with 5.2 billion Maggi noodles
packs sold across the world every year, has gross
Domestic sales of Nestle (Rs. 10129 Crore in 2014) in
India and Rs. 2961 crores as Gross Domestic sales of
Nestle Segment which mostly comprises of Maggi in 2014.
In June 2015, it was reported in India that tests had found
high amounts of Lead and MSG in Maggi noodles, and
FSSAI ordered country-wide withdraw and recall for all 9
variants of “Instant Noodles and Oats Masala Noodles”
of Maggi. This recall has eroded 1300 crore of Brand
Value of Maggi. The paper explores the inside story of the
controversy of higher MSG (Monosodium Glutamate) and
Lead levels.
Keywords
Nestle India, Maggi, Monosodium Glutamate (MSG),
Lead, Instant Noodles.
INTRODUCTION
“Life is Good Food; Good our mission and we are
constantly researching and observing the role that food
plays in the lives of consumers across the income pyramid.
We are focused on understanding the changing lifestyles,
evolving needs, and dietary preferences of consumers and
rely on Nestlé’s extensive global R&D network and
expertise in science based nutrition to develop products
that enable consumers to lead better lives and help them to
improve nutrition in their daily diets. However, since what
we eat, when we eat, how we eat is a personal choice, we
realize that the role of nutritional education and the ability
to make an informed choice is important and we have been
rolling out initiatives that will be useful for consumers.”
Mr. A. Helio Waszyk, Chairman and Mr. Etienne Benet,
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ISSN: 2319-4421 35
Managing Director, wrote in Annual Report, Nestle India
Ltd, 2014, pp 5.(1)
“MAGGI is like our Mothers who are constantly
understanding our lifestyles as we grow, going deeper for
consumer insights, beyond the obvious and searching for
the ‘moment of truth’. This reflects in the WPP- Milward
Brown survey of 2014 (2) that recognised MAGGI
anticipating our needs, preparing for them and nurturing
them, sensing the change in our personalities and speaking
our language. MAGGI has constantly been as ‘The Most
Powerful Brand in India’. Maarten Geraets – GM. (3) In
June 2015, it was reported in India that tests had found
high amounts and of lead MSG in Maggi noodles, and
FSSAI ordered country-wide withdraw and recall for all 9
variants Instant Noodles of Maggi and Oats Masala
Noodles.(4)(5) This recall has eroded 1300 crore of Brand
Value of Maggi. (6)
THE COMPANY
Maggi is an international brand of seasonings, instant
soups and noodles owned by Nestle since 1947. The
original company was founded in Switzerland in 1872 by
Mr.Julius Maggi. The original company came into
existence in 1875 in Switzerland when he took over his
father's mill. He quickly became a pioneer of industrial
food production, aiming to improve the nutritional intake
of worker families. Maggi was the first to bring protein-
rich legume meal to the market, and followed up with a
ready-made soup based on legume meal in 1886. In 1882
he served up two instant pea soups and an instant bean
soup accelerating the movement to easier food preparation
and enjoyment. In 1897, Julius Maggi founded the
company Maggi GmbH in the German town of Singen,
where it is still based today. In 1947, following several
changes in ownership and corporate structure, Maggi's
holding company merged with the Nestlé company to
form Nestlé-Alimentana S.A., currently known in its
francophone home base as Nestlé S.A.(7)
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
Figure-1: the Share Prices of Nestle from May, 2015 to 29.9.15 date
Source: moneycontrol.com retrieved on 29.9.15
NESTLÉ's relationship with India dates back to 1912,
when it began trading as The NESTLÉ Anglo-Swiss in
1947, the economic policies of the Indian Government
emphasised the need for local production. NESTLÉ
responded to India's aspirations by forming a company in
India and set up its first factory in 1961 at Moga (Punjab),
where the Government wanted NESTLÉ to develop the
milk economy. Progress in Moga required the introduction
of NESTLÉ's Agricultural Services to educate, advise and
help the farmer in a variety of aspects. From increasing the
milk yield of their cows through improved dairy farming
methods, to irrigation, scientific crop management
practices and helping with the procurement of bank loans.
NESTLÉ set up milk collection centres that would not
only ensure prompt collection and pay fair prices, but also
instil amongst the community, a confidence in the dairy
business. Progress involved the creation of prosperity on
an on-going and sustainable basis that has resulted in not
just the transformation of Moga into a prosperous and
vibrant milk district today, but a thriving hub of industrial
activity, as well. NESTLÉ has been a partner in India's
growth for over nine decades now and has built a
Condensed Milk Company (Export) Limited, importing
and selling finished products in the Indian market. After
India's independence the company developed a very
special relationship of trust and commitment with the
people of India. The Company's activities in India have
facilitated direct and indirect employment and provides
livelihood to about one million people including farmers,
suppliers of packaging materials, services and other goods.
(8)
The Company continuously focuses its efforts to better
understand the changing lifestyles of India and anticipate
consumer needs in order to provide Taste, Nutrition,
Health and Wellness through its product offerings. The
culture of innovation and renovation within the Company
and access to the NESTLÉ Group's proprietary
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ISSN: 2319-4421 36
technology/Brands expertise and the extensive centralized
Research and Development facilities gives it a distinct
advantage in these efforts. It helps the Company to
achieve international quality under internationally famous
brand names such as NESCAFÉ, MAGGI create value that
can be sustained over the long term by NESTLÉ IndiaIt
also manufactures products like, MILKYBAR, KIT KAT,
BAR-ONE, MILKMAID and NESTEA and in recent
years the Company has also introduced products of daily
consumption and use such as NESTLÉ Milk, NESTLÉ
SLIM Milk, NESTLÉ Dahi and NESTLÉ Jeera Raita.
NESTLÉ India is a responsible organisation and facilitates
initiatives that help to improve the quality of life in the
communities where it operates, offering consumers a wide
variety of high quality, safe food products at affordable
prices. (9)
After more than a century-old association with the
country, today, NESTLÉ India has presence across India with
8 manufacturing facilities and 4 branch offices. NESTLÉ
India set up its first manufacturing facility at Moga
(Punjab) in 1961 followed by its manufacturing facilities
at Choladi (Tamil Nadu), in 1967; Nanjangud (Karnataka),
in 1989; Samalkha (Haryana), in 1993; Ponda and
Bicholim (Goa), in 1995 and 1997, respectively; and
Pantnagar (Uttarakhand), in 2006. In 2012, Nestle India
set up its 8th manufacturing facility at Tahliwal (Himachal
Pradesh). (10)
PRODUCT MIX: THE CRISIS WITHIN
The Brand Maggi- has presence in 130 countries with 5.2
billion Maggi noodles packs sold across the world every
year, has gross Domestic sales of Nestle (Rs. 10129 Crore
in 2014) in India and Rs. 2961 crores as Gross Domestic
sales of Nestle Segment which mostly comprises of Maggi
in 2014. (11)
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International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 37
Volume 4, No. 10, October 2015

Figure-2: Product Mix of Nestle India Ltd

Source: www.nestle.in

Table: 1: Product Mix of MAGGI

S.NO. PRODUCT PRODUCT EXPLANATION
1 MAGGI MAGGI VEG ATTA It comes packed with everyone's favourite MAGGI
NOODLES NOODLES Masala taste & healthy because it is made with ATTA
and has real vegetables in it. Each delicious serve
(80g) of MAGGI Veg Atta Noodles provides dietary
fibre equal to 3 rotis.
MAGGI OATS NOODLES MAGGI Oats Noodles, yet another pioneering
innovation from MAGGI to offer Taste Bhi Health
Bhi to all its fans. Exciting, delicious noodles made
with wholegrain Oats that offer: Fibre of 1 bowl oats;
Real vegetables; Favourite MAGGI masala taste
MAGGI -2 MINUTES MAGGI 2-MINUTE Noodles is the most-loved meal
NOODLES across all age groups and defines the Instant Noodles
category in India by being a part of our way of life. It
has been bringing people together and is the favorite
of millions; living in our hearts it has become
intertwined in some of people’s most memorable
experiences. MAGGI 2-Minute Noodles brings to you
10% RDA of Protein and 20% RDA of Calcium in
each serve (75g). With a reduction of over 27% salt
per serve, less than 0.2% Trans Fats and no added
MSG’s MAGGI Noodles has focused on providing
you a healthier meal, without compromising on the
great taste you love.
MAGGI CUPPA MANIA With multi-tasking becoming a necessity, it is
essential that you have a quick meal that is healthy as
(1). MASALA YO well. MAGGI Cuppa Mania Noodles fits perfectly
(2). CHILLY CHOW YO into your lifestyle while satisfying that hungry belly
with instant taste, anytime. Just add boiling water for a
quick and healthy meal. With 2 mouth watering
variants; a fork inside for on-the-go consumption,
attractive cup sleeves, real vegetables and calcium.
2 MAGGI (1). MASALA PENNE MAGGI brings to you NUTRI-LICIOUS PAZZTA -
PAZZTA (2). CHEESE MACARONI an offering to delight your every sense and make you
(3). TOMATO TWIST fall in Love! It comes in 4 saucy, lip-smacking
(4). MUSHROOM PENNE flavours and shapes. This NUTRI-LICIOUS product is

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International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 38
Volume 4, No. 10, October 2015

made from 100% SUJI and is also a source of protein

& fibre.
3 MAGGI (1). TOMATO KETCHUP Launched in the mid-1980s, MAGGI Sauces has been
SAUCES (2). TOMATO SAUCE associated with category re-defining innovations from
(3). HOT & SWEET the very beginning, starting with the launch of the
TOMATO CHILLI SAUCE unique MAGGI Hot & Sweet and “It’s different”
(4). MAGGI PICHKOO commercials. Over the years, MAGGI has
continuously re-invented itself in terms of new
products, packaging, promotion & distribution to
emerge and sustain itself as the largest sauces brand in
India. MAGGI has also launched the Rich Tomato
Ketchup in the convenient toy pack format called
Pichkoo that has made the unique flavors of MAGGI
affordable to a whole new set of consumers.
4 MAGGI MAGGI MAGIC CUBES With MAGGI Magic Cubes, you can cook the smart
COOKING way while adding that mouth-watering flavor to your
AIDS (1).VEGETARIAN meals. That’s not all; as you crumble a MAGGI Magic
MASALA cube into your dish, your curries, biryani and even
(2).CHICKEN non-vegetarian dishes turn rich and delicious in no
time. It is time for you to don the Chef’s hat at home.
MAGI BHUNA MASALA MAGGI is revolutionizing the Indian kitchen with its
latest offering – MAGGI Bhuna Masala. Based on
(1). MAGGI BHUNA intensive research and in-depth understanding of
MASALA FOR GRAVY Indian food habits and cooking practices, MAGGI
DISHES Bhuna Masala allows the housewife to prepare a large
(2). MAGGI BHUNA variety of tasty dishes without the hassle of chopping
MASALA FOR KORMA and frying. The dishes retain that ‘special touch’ of the
DISHES housewife as she adds her own spices….. Standing
(3). MAGGI BHUNA strong on its promise of “Taste Bhi, Health Bhi”,
MASALA FOR MAKHANI MAGGI Bhuna Masala comes with "no added
DISHES preservatives", "contains only 1 tbsp of oil" and "tastes
just like homemade." Gives you a perfect dish in three
simple steps:
• Open the pack & pour contents in the pan
• Add vegetables/paneer/chicken/rajma etc.
• Add spices and cook
MAGI COCONUT MILK MAGGI Coconut Milk Powder brings the coastal
POWDER flavors right to your kitchen. It has been developed by
retaining the real flavor from Sri Lankan Coconuts in
a powder form. Simply add warm water to MAGGI’s
Coconut Milk and use it in curries, casseroles, rice
preparations, cookies and blender drinks for that
authentic coconut milk flavor.
MAGGI MASALA-E- The first ever fortified taste enhancer that can be used
MAGIC across different cuisines in India. It is not a simple
masala, but is unique in that it efficiently enhances the
taste inherent in the food ingredients already present.
It is specifically fortified with Iron, Vitamin A &
Iodine that are known to be widespread deficiencies in
India.
5 MAGGI (1). RICH TOMATO The new range of Maggi Healthy Soups is distinctly
SOUPS (2). MIXED VEGETABLE delightful. These soups are made using Nestlé’s new
(3). CREAM OF and patented granulation based technology that allows
MUSHROOM them to retain the freshness of key ingredients, giving
(4). HOT & SOUR you that extra zing of taste. They contain fresh
VEGETABLE vegetable purees and deliver the taste and aroma of
(5). SWEET CORN home-made soups. In fact, Nestlé India is amongst the

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International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 39
Volume 4, No. 10, October 2015

VEGETABLE first in the Nestlé world to adopt this unique

(6).CREAMY SPINACH technology. Maggi Healthy Soups are low fat, low
cholesterol , have no added MSG, and have no added
preservatives and synthetic colours, living up to the
Maggi promise of Taste Bhi, Health Bhi!.
Source: www. Maggi.In Retrieved on 2.10.15

INSTANT NOODLES AND MARKET SHARE: Maggi Noodles is as shown in the Diagram: 1. India is at 4th
has dominated the market since three decades with the Position after China, Indonesia and Japan. (12)
market share of 70%. The global demand of Instant

Figure 3: Global Demand of Instant Noodles

Source: http://timesofindia.indiatimes.com/business/india-business/Nestles-70-noodle-market-share-faces-
heat/articleshow/47534610.cms

The demand of instant noodles is picking up (Diagram- There is lot of scope in the said market (Product
2)and expected to reach US $ 1.85 billion by year 2019. Category). (13)

Figure 4: Size of India’s Noodles Market.

Source: http://qz.com/420932/charted-how-maggi-rules-indias-noodle-market

THE CONTROVERCY: CLAIMS AND Rs 1,270 crore in brand loss according to global valuation
COUNTER CLAIMS consultancy Brand Finance. (14)

An officer of the UP Food Safety and Drug Administration

Maggi noodles, Nestle’s flagship brand, were doing sales based in Barabanki (UP) ordered tests on a dozen samples
of over Rs 2,000 crore before the ban. The recall exercise of Nestle’s Maggi instant noodles at the state laboratory in
of Maggi noodles has cost Nestle Rs 320 crore and another Gorakhpur, and repeat tests at the Central Food Laboratory
in Kolkata, a referral lab. The Gorakhpur lab tested for

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Volume 4, No. 10, October 2015

monosodium glutamate (MSG) to check Nestle’s claim
that Maggi had none. Both tests found MSG; in addition,
the Kolkata lab found “very high quantities” of lead —
17.2 parts per million. 25. Based on the findings, UP FDA
filed a complaint in a Barabanki court. On June 8,2015,
Union Food Minister directed the statutory regulator, Food
Safety and Standards Authority of India (FSSAI), to
conduct nationwide tests on Maggi. (15)
According to Food Safety and Standards Rules, 2011,
MSG, a “flavour enhancer”, should not be added to food
for infants below 12 months. MSG is not permitted in over
50 items, including “Pastas and noodles (only dried
products)”, but is allowed in the seasoning used for
noodles and pastas. Under Food Safety and Standards
(Contaminants, Toxins and Residues) Regulations, 2011,
permissible levels of lead range from 0.2 parts per million
in infant milk substitute and infant foods to 10 ppm in
categories like baking powder, tea, dehydrated onions,
dried herbs and spices flavourings. For instant noodles
included in the “foods not specified category”, the
permitted level of lead is 2.5 ppm. Instant noodles like
Maggi are identified under food category code 6.4.3,
which includes “pre-cooked pastas and noodles and like
products” that are “pre-gelatinised, heated and dried prior
to sale”. These categories of food are governed by Codex
international standard 249, standards of food safety
recognised by WHO. The masala used in these noodles is
identified in code 12.2, which includes herbs, spices,
masalas, seasonings, and condiments (eg., seasoning for
instant noodles), where the use is “intended to enhance the
aroma and taste of food”, according to FSSAI regulations.
(16)
In addition to the regular testing of the finished product
and raw materials, the company has carried out extensive
tests of MAGGI Noodles in India. Nestlé India has tested
more than 2,700 product samples of MAGGI Noodles,
including 1,100 samples at independent accredited labs in
India and abroad. These tests represent more than 165
million or 16.5 Crore packets of noodles in total. These
tests found that levels of lead in the products were within
the food safety limits specified by the Indian authorities,
which is why we are saying the products are safe for
consumption. On 30 June, the Hon’ble Bombay High
Court allowed Nestlé India to continue exporting MAGGI
Noodles. (17)(18)
Nestlé India currently exports MAGGI Noodles to Nestlé
in Canada, UK, Singapore and Kenya and to third parties
in the US, Australia and New Zealand. (19)
The noodles made for the export market are the same as
those for the Indian market, although Canada requires a
different kind of salt to be used. Packaging materials are
designed to meet the regulatory requirements of each
importing country.
Food standards authorities in USA, Canada, UK,
Singapore, Australia and New Zealand have all tested
samples of MAGGI Noodles and confirmed that they are
safe to eat.

Table-2 Summary of Statements of Authorities in various countries

Country Authority/ Agency Explanation
USA (20) US Food and Drug The US Food and Drug Administration (FDA) has
Administration (FDA) confirmed that tests on several shipments of
MAGGI noodles from India did not find any health
risks to consumers. The FDA has released the noodles
for sale in the United States. 11 August 2015 – We
have learnt from our official importer in the United
States, House of Spices, that the US Food and Drug
Administration has tested several shipments of
MAGGI Noodles from India for lead content. Finding
no unsafe lead levels, FDA released the noodles for
sale in the United States.
Canada (21) Canadian Food 2 July 2015 – On June 5, 2015, the Canadian Food
Inspection Agency Inspection Agency (CFIA) issued a Consumer
(CFIA) Advisory regarding the actions taken in response to
the incident in India involving MAGGI brand
noodles, including Nestlé's removal of products from
the Indian marketplace. The CFIA's food safety
investigation did not find any health risk associated
with the consumption of MAGGI brand noodle
products sold in Canada.
UK (22)(23) UK Food Standards 1 July 2015 – The FSA can confirm that results from
Agency (FSA) testing samples of MAGGI Noodles in the UK have
all found that levels of lead in the product is well

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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
Vietnam (23) Vietnam Food
Administration (VFA)
Australia and New National Measurement
Zealand (24)(25) Institute
Singapore (26) Agri-Food and Veterinary
Authority (AVA)
Ironically, in a major boost to Nestle India, FSSAI-
approved laboratory of Central Food Technological
Research Institute (CFTRI) has found Maggi noodles to be
in compliance with the country's food safety standards.
CFTRI had tested five samples sent by Goa Food and
Drug Administration (FDA) when Maggi was banned in
June in the wake of findings in Uttar Pradesh and other
states that the instant noodles brand had lead levels beyond
permissible limits. This was later denied by the authorities
of FSSAI.
INDIAN STATES BANNED MAGGI: Delhi/3 June, 15;
Maharashtra/5 June, 15; Punjab/ 6 June,15; Assam/5
June,15; Bihar/5 June,15; Madhya Pradesh/5 June, 15;
Tamil Nadu/4 June,15; Jammu and Kashmir/4 June,15;
Gujrat/4 June,15; Uttrakhand/4 June,15; Goa/7 June,15;
Karanataka/7 June,15; Andhra Pradesh/4 June,15;
Kerala/3 June,15.
MYTH OR REALITY ABOUT LEAD AND
MSG IN MAGGI
THE LEAD ISSUE: Lead occurs in the earth’s crust and is
present in air, soil and dust. The CODEX Alimentarius
standards are a key reference for Nestlé. Nestle, test lead
levels in the raw materials and source ingredients from
regions with the lowest levels of lead. The authorities have
also set firm limits to ensure that any lead present in a
finished product are within recommended food safety
levels and safe to consume. It regularly monitor all our
raw materials for lead, including testing by accredited
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within EU permissible levels and would not be a
concern to consumers.
22 June 2015 – The Vietnam Food Administration
has received a report from the Public Health Institute
in Ho Chi Minh City on tests conducted on MAGGI
Noodles imported from India by Toan Cau Pans
Company Ltd, address: 102 Topaz 2, Saigon Pearl 92
Nguyen Huu Canh, Ward 19, Binh Thanh, Ho Chi
Minh City. The test results of two samples showed
that lead (Pb) was not detected in the product.
19 June 2015 –Testing by the National Measurement
Institute in Australia has confirmed that MAGGI
Noodles imported from India are completely safe to
eat. Testing showed that levels of lead were well
within the acceptable limits set by the regulator, Food
Standards Australia and New Zealand.
11 June, 2015-Results from the Agri-Food and
Veterinary Authority’s (AVA) recent food safety tests
on MAGGI Noodles available in Singapore, including
those produced in India, showed that the noodles met
Singapore’s food safety standards and do not pose
food safety risks to consumers. On 8 June, AVA
confirmed that MAGGI Noodles available in
Singapore are safe for consumption.
laboratories. These tests have consistently shown lead in
MAGGI Noodles to be within safe limits. We do more
food testing than any other entity in the world and have
many stringent controls to guarantee safety: starting from
the raw materials we use, throughout processing to
packaging. We adhere to the same quality standards
wherever in the world we operate.
MSG ISSUE: The amino acid L-Glutamate is one of the
most abundant and important amino acids of proteins. It is
found in all foods that contain protein, such as cheese,
milk, mushrooms, meat, fish, and many vegetables. The
natural flavour-enhancing levels of glutamate in food vary
greatly, but are high in foods such as tomatoes,
mushrooms, soy sauce and fish sauce. Monosodium
glutamate, abbreviated as MSG, was discovered more than
a century ago by the Japanese scientist Kikunae Ikeda,
who gave this unique taste the name “umami”, the fifth
taste beside sweet, sour, salty and bitter. Today, MSG is
mostly produced by a natural fermentation process that has
been used for centuries to make such common foods as
beer, vinegar and yogurt.
Leading international food authorities have confirmed
MSG is safe to use in food under common conditions of
use. These authorities include the international World
Health Organization/UN Food and Agriculture
Organisation’s evaluation committee, the European
Commission’s Scientific Committee for Food and the
United States Food and Drug Administration. There have
been some concerns raised about the contribution of MSG
to sodium intake via the diet. However, MSG contains
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only about one-third the amount of sodium as table salt
(13 percent vs. 40 percent) and so where we use it in
products, in combination with a small amount of table salt,
MSG can help reduce the total amount of sodium in a
recipe by 20% to 40%, while maintaining an enhanced
flavour. The level of glutamate for example in Maggi
noodles is around 0.2 g/100 g, which is close to the
average level of glutamate measured in the same portion
size of tomatoes or peas. (27)

Table-3: Nestle is Committed to Food Safety

FOOD SAFETY IN NESTLE: FACTS FOOD SAFETY IN INDIA: FACTS
1.“FOOD SAFETY IS OUR NUMBER ONE 1.”WE HAVE SAME RIGROUS APPROACH TO
PRIORITY” FOOD SAFETEY IN INDIA THAT WE HAVE
2. We are one of the most active entities in the world EVERYWHERE ELSE”.
when it comes to food testing. 2. We have 300 PEOPLE in total in quality assurance
3. In total around 100 MILLION ANALYSES A in India around half working in our 9 labs there (8 in
YEAR are carried out for Nestle. Our own 26 NQAC factory, 1 NQAC internationally accredited) and we
(Internationally Accredited) laboratories perform work with third-party external laboratories.
around 3 million analyses a year. 3. In recent days we have tested samples from batches
4. We have 8000 persons working in Quality representing more than 125 MILLION PACKETS OF
Assurance worldwide. MAGI NOODLES.
5. We have much Stringent inbuilt control to 4.We have sent samples from an additional 600
GUARANTEE SAFETY from raw material selection BATCHES TO AN EXTERNAL LABORATORY.
through to processing and packaging. 5. We have tested samples from 1000 BATCHES AT
6. Over the years the industry approach has shifted OUR OWN ACCREDITED LABORATORIES.
from looking for defects in finished products to trying 6. WE ARE ALSO TESTING THE RAW
to identify their root causes as early as possible in the MATERIALS such as the wheat we make the noodles
supply chain so we can UNDERSTAND AND with and the spices we use to flavour the noodles.
PREVENT THEM. 7. ALL THE RESULTS SHOW THAT THE LEAD
7. We have early warning system to help us IS BELOW THE LEVELS SPECIFIED BY
PINPOINT SIGNALS WHICH MAY TURN INTO REGULATORS.
ISSUES.
8. In 2013 in Switzerland we opened the MOST
ADVANCED LABORATORIES OF THEIR KIND to
study food borne pathogens. We built them so we can
respond to emerging risks.
source: www.nestle.in retrieved on 26.9.15

MAGGI: A SWOT ANALYSIS
Maggi is a food brand best known for its instant noodles,
ketchups, sauces, seasonings, pasta and soups. The brand
is owned by Nestlé India, which introduced a new food
category to the Indian market when it launched Maggi 2-
Minute Noodles in 1982.
Since then, Maggi has developed a product range
promoting the twin benefits of taste and health.
Advertising and marketing showcase the emotional
satisfaction that customers associate with the brand. With
tag lines such as “Fast to Cook, Good to Eat” and “Tasty
and Healthy,” Maggi markets itself as purveyor of quick
and nutritious snacks.
STRENGTHS:
• Highest Market Share: Maggi pioneered the
concept of packaged instant noodles in India three
decades back and despite several brands entering
the fray, dominates the space. Maggi has a 70%
share of Rs. 4000 Crore Instant Noodle Indian
market. ITC Foods' Sunfeast Yippee has garnered
18% of the market. Hindustan Unilever, which
markets Knorr soupy noodles, GSK, Horlicks
foodles and Indo-Nissan Top Ramen holds the
balance share 12% with other brands.
• Family Brand Image: Maggi has established itself
as The Family Brand because all in the family:
Grand Parents, Parents and Siblings all like and
love maggi noodles. With the presence in different
product categories under the umbrella brand of
Maggi with large SKU’s (Stock keeping
unit).Maggi have edge over its competitors.
• Truly International Brand: The Maggi brand
originates from Switzerland where in 1863 Julius
Maggi created a recipe of flavours to bring added
taste to meals. Industrial revolution in Switzerland
created factory jobs for women, who were therefore
left with very little time to prepare meals. Maggi
was the first to bring protein rich legume meal to
the market, which was followed by readymade soup
based on legume meal in 1886. In 1947 Nestlé

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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
acquired the Maggi brand. Besides noodles, Maggi
is available in soups, seasonings and sauces
category. Maggi was introduced in India in 1982. In
its first ads, the brand popularised the image of the
“Maggi Mom”. When it did not work much, Maggi
was later targeted at kids. After its advertisements
with taglines like "Mummy bhookh lagi, bas do
minute" Maggi gained popularity. Taglines like
Fast to Cook Good to Eat, 2-minute noodles and
Taste bhi, Health Bhi are strong brand elements of
Maggi. Etienne Maurice Firmin Bouisset, a French
painter, artist and printmaker developed and
designed the logo of Maggi.
• Strong Brand in Urban and Rural India: Maggi has
already dominated the Urban-Rural Area segment
with opening up of 22000 retail outlets. According
to the company’s annual report, Maggi Rasile
Chow has been developed especially for rural/semi-
urban markets to provide “a low cost, tasty light
meal that is fortified with iron…Maggi further
leveraged its strength last year to drive affordable
nutrition”. The Masala-e-Magic is a fortified taste
enhancer with iron, iodine and Vitamin A.
• Maggi started “Revolution of Cooking Food
Instantly” in India: When Maggi instant noodles
arrived in India in 1983 - the year when India lifted
the cricket World Cup for the first time - they
instantly caught the nation's imagination. The idea
that anything could be cooked in two minutes had
an immediate impact on a people that had invented
slow food centuries before it became fashionable in
fast food cultures. The "two-minute noodles"
advertising campaign on state-run television with
which Maggi launched itself turned out to be an
instant attraction because of its liberating message
for women. The "Maggi Mom" was not only seen
as loving and caring of her children as her mother
was of her, but she was also able to juggle her
workplace and domestic responsibilities because of
the snack.
• Nestle-Warm, Family & Shelter: All over the
world, Nestle started in 1897, has become the
symbol of warmth, family and shelter. This has
developed a unique bond of trust among the
consumers and the company.
• Research and Development Centre in India: in
2012, Nestlé is opening its first research and
development centre in India to further its
understanding of Indian consumers, traditional
ingredients and local cuisine, and to provide
scientific and technological expertise to the rest of
its global business. The centre, which will
specialise in Asian noodles and Indian cooking, will
focus on developing highly nutritious, affordable
products in appropriate serving sizes for lower
income consumers. Researchers will gain expertise
in the use of local ingredients and culinary
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traditions – work Nestlé expects to be a source of
new ideas for products. The company has invested
CHF 50 million in the centre, which is located in
Manesar close to Nestlé India’s headquarters in
Gurgaon. With its new R&D centre in India, Nestlé
aims to extend the range of mainstream products it
currently offers consumers in the country,
particularly in the noodles, cereal, beverage and
dairy categories.
• High Customer Pull: With its distinguished
promotion strategies & branding hence creating
strong customer connects had helped Maggi to have
High TOMA score (Top of the Mind Awareness)
WEAKNESSES
• Maggi Controversy has Eroded the Brand Value:
Brand value of Maggi is expected to fall by over
$200 million or nearly 1,300 crore, as a result of a
ban on the popular instant noodles by Indian
authorities. On 5 June, the food regulator mandated
Maggi-maker Nestle India to recall all the available
stock in the market following confirmation of
harmful levels of lead in the 'two-minute noodles'.
Nestle India is estimated to recall 27,420 tonnes of
Maggi noodles, including about 1,422 tonnes of
noodles that are at its five factories in the country.
Currently, the factories have halted the production
of Maggi noodles. Before the ban, Maggi's brand
had a valuation of $2.4 billion and its manufacturer
was the 23rd most valuable global food brand. A
loss of $50 million in recalling Maggi noodles
along with "damaged brand" is estimated to shrink
the brand value to $2.2 billion, according to Brand
Finance.
• Maggi-Generic Brand to Noodles in India: Sales of
Nestle's other products under Maggi, which include
soup, ketchup, mixes and coconut milk, are down
by around 30%. Launched in 1984 by Nestle India,
the 2-minute Maggi continues its strong ride in the
Rs 1,300-crore noodles market that it has helped
create. It is difficult to say why Maggi’s brand
magic has endured in the face of repeated attempts
by global rival FMCG majors likes Hindustan
Unilever and GSK, the latest being the launch of
Horlicks Foodles and Knorr respectively earlier this
year. Is it convenience, taste, connect, nostalgia or
all of these? So strong is the Maggi magic that the
brand name has virtually become a generic name
for the product category. But does Maggi have the
verve to grow further or would it tire and retire
gracefully?
• Low Rural Market Presence: Products for the rural
market will also help the company maintain a
balance. In the last two years, when the urban
markets cooled down, the rural markets continued
to remain buoyant. High support prices for all large
crops, the National Rural Employment Guarantee
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
programme, and the farm loan waiver have ensured
that there is good purchasing power in the rural
markets. This has begun to drive FMCG companies
to villages and small towns. Nestle is no exception.
A couple of weeks later, it came out with two new
products, this time for the rural and semi-urban
markets at lower price points of Rs 2 and Rs 4
(Maggi Masala-ae-Magic and Maggi Rasile Chow).
The Swiss major obviously wants to have its
footprint in both India as well as Bharat – the
common theme being a 'Taste bhi, health bhi’
product, a positioning Maggi started with the
launch of an atta (flour) variant.
• Maggi is a Uniform Brand: Nestle India will
consider introducing new products, including under
the Maggi brand, while looking to drive growth of
other categories with increased advertising
spending, as it looks to overcome the setback from
the ban on its flagship instant noodles. The
company was not diluting the importance of Maggi
as it is "is a big part of our movement". On the
impact on other categories, the MD said: "There has
been impact on the rest of the portfolio because it is
also sold in similar outlets and in similar
geographies. I can say that it has been reasonably
uniform across all the categories.
OPPORTUNITIES
• Growing Package Industry in India: The Maggi
noodles controversy is likely to be a stepping stone
in the evolution of India's packaged and processed
food industry, which could result in better labelling,
packaging and testing norms for the entire sector,
according to Japanese financial services firm
Nomura. The Indian packaging industry is growing
continuously. The total worth is about USD 24.6
billion. The average annual growth rate is about 13
- 15%. However, there is great growth potential
since India’s per capita consumption of packaging
is only 4.3 kgs whereas neighboring Asian
countries like China and Taiwan show about 6 kgs
and 19 kgs, respectively.
• Repositioning the Maggi: For a brand that is exactly
not what the doctor prescribed as a part of the daily
diet, Maggi has a phenomenal legacy in India
transcending demographics and psychographics.
From college canteens to upmarket office cafes, it
has been the ubiquitous hunger-satiater for long.
Many even go to the extent of admitting that after
wheat and rice it has become the third staple of the
country, such is its reach. Touted as a Rs 16,000
crore brand, as per sources and possibly the second
largest brand in the country, second only to Parle-
G, Maggi has for the first time been shaken up by
competition in the form of ITC's Sunfeast Yippee,
and a few others like Indo Nissin, Wai Wai etc
nipping away at its share.
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• High Brand Awareness of Indian Consumer: The
marketers think the Indian consumer is very
fashionable and knowledgeable. They are educated
about the brands and are aware of the prices as well.
This made us take some time to land our plane
right; you really need to get it right. You only get
one shot at the market. And you need to get it right
and create great impression because you don't get a
second chance. That is why we took some time to
get to the Indian shores. We are bringing American
casual style and we do not see too much of it
• The Unexplored Market of Snacks in India: The Rs.
58000 crore snack market in India is still
unexplored. Busy lifestyles and increasing snacking
will remain behind the high volume growth in
sweet and savoury snacks in India. Aggressive
promotional campaigns by leading manufacturers,
new launches and improvements in the distribution
via modern retail channels penetrating into rural
India will also drive demand during the forecast
period. Sweet and savoury snacks will continue to
be enjoyed as favourite indulgence items with their
spicy and tangy offerings.
• Opportunity to be Substitute to Other Snacks
Category of Food Products (Brand Extension):
Maggi can expand its product categories by
venturing out in corn flakes, Chips & Pickles
(Although it failed in 2003 but now with presence
of local & national players in this product category,
company can reap the benefits).
• Long Potential Rural Markets: Although it’s been
used majorly by the educated class in order to save
their time what if the long potential rural markets
can also be penetrated with the innovative strategies
pertaining to consumers engagement with the
brand.
• Also Company can target the Restaurants chains by
offering some customized or special offerings to
make it more short of part of the daily life of the
consumers.
THREATS
• Competitors: Currently the Indian ketchup market
is valued at Rs. 220 crore. The top Ketchup Brands
in India are Maggi Kissan and Heinz. Nestle's
Maggi leads the Indian ketchup market with a
market share of 37 cent. Hindustan Unilever
Limited's Kissan follows with a market share of 29
per cent and Heinz holds a total per market share of
around 10 percent. Maggi, has been dominating the
instant noodles market in India for nearly three
decades, is currently witnessing tough competition
with a number of new entrants such as Sunfeast
Yippee, Hindustan Unilever's (HUL) Knorr Soupy
Noodles, Top Ramen and Ching's Secret.
• FDI in Food Processing Industry: 100% FDI is
permitted in the automatic route for most food
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
products except for items reserved for micro and
small enterprises. 100% FDI is permitted for
alcoholic beverages, with the requirement of an
industrial license. For pickles, mustard oil,
groundnut oil and bread – items reserved for the
micro small and medium sector, 24% foreign direct
investment is allowed under the automatic route,
with the requirement of prior approval from the
Foreign Investment Promotion Board for FDI
amounting to more than 24%.
• Drivers and Reduced Entry Barriers in the Food
Business: Further incentives such as high tax
rebates, depreciation benefits and reduced custom
and excise charges also encourage companies into
food processing. Imaginative and targeted policies
such as 'Food Parks' are designed to address
weaknesses throughout the value chain.
• Negative Word of Mouth (WOM): Propagation of
ill effects of Maggi noodles deterioration in
perceived value of the Maggi brand due to its
Noodles product category through online & Social
Media possess threats to the existence of Maggi. As
can affect the brand as a whole.
• Pressure to Sustain the Quality of the finished
product and be No.1 Brand (Commoditized name):
For majority population the name Maggi is
being commoditized for Noodles just like Coalgate
as toothpaste, Surf as washing powder, Lux as
bathing soap etc. in FMCGs.
DISCUSSION
For over thirty years, Maggi has been the part of the
Indian food culture. We must understand the strength of
Maggi as a brand and realize that the number of people
who will be hurt by the ban on Maggi will be in millions.
Maggi is owned by Swiss company Nestle and sold in 130
nations, but the sale of Maggi in India accounts to 30% of
its turnover. These figures are sufficient enough to
understand the brand value of Maggi. The news of Maggi
being harmful to health is shocking for everyone including
the elite and the common man. But people have diverse
opinion about the Maggi controversy. Several people have
straightaway supported the ban on Maggi and while some
have some have asked the question “Why only
Maggi?”.Many outlets and institutions have banned Maggi
but there is no common opinion about the Maggi ban in
different states of India. Many states like Maharashtra,
Goa in Western India, Jammu Kashmir, Himachal Pradesh
in North and nearly all states in East and South, have not
yet banned Maggi. Maggi is popular in Pakistan, Nepal,
Bangladesh and Sri Lanka but they are yet to act on this.
? Is Maggi Safe?
? Is Maggi harmful for human consumption?
? Is the “Maggi controversy” justified?
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? Is this a “media trial”?
? Why Maggi is not banned by all the states of India?
? Why Maggi export is not banned?
? Why countries like USA, UK, Australia & New
Zealand etc have given clearance to Maggi?
? Is this going to dent Make-In-India campaign?
? Is this questions the sovereignty of MNC’s working in
India?
? Is this an Ethnic/cultural/social/political/financial
oriented issue?
? How do you see Maggi’s come back?
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 4, No. 10, October 2015
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ISSN: 2319-4421 46
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